What Type Of Returns Would Bumi Armada Berhad's(KLSE:ARMADA) Shareholders Have Earned If They Purchased Their SharesFive Years Ago?

It is a pleasure to report that the Bumi Armada Berhad (KLSE:ARMADA) is up 34% in the last quarter. But that doesn't change the fact that the returns over the last half decade have been disappointing. Indeed, the share price is down 61% in the period. So we're not so sure if the recent bounce should be celebrated. Of course, this could be the start of a turnaround.

Check out our latest analysis for Bumi Armada Berhad

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

Bumi Armada Berhad became profitable within the last five years. That would generally be considered a positive, so we are surprised to see the share price is down. Other metrics might give us a better handle on how its value is changing over time.

Revenue is actually up 4.9% over the time period. A more detailed examination of the revenue and earnings may or may not explain why the share price languishes; there could be an opportunity.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

Bumi Armada Berhad is well known by investors, and plenty of clever analysts have tried to predict the future profit levels. You can see what analysts are predicting for Bumi Armada Berhad in this interactive graph of future profit estimates.

A Different Perspective

It's good to see that Bumi Armada Berhad has rewarded shareholders with a total shareholder return of 25% in the last twelve months. There's no doubt those recent returns are much better than the TSR loss of 10% per year over five years. This makes us a little wary, but the business might have turned around its fortunes. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. For instance, we've identified 3 warning signs for Bumi Armada Berhad (1 makes us a bit uncomfortable) that you should be aware of.

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on MY exchanges.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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